Technological Progress and Economic Geography

Takatoshi Tabuchi, Jacques-François Thisse and Xiwei Zhu
Additional contact information
Jacques-François Thisse: CORE, Université catholique de Louvain, NRU-Higher School of Economics and CEPR
Xiwei Zhu: Center for Research of Private Economy and School of Economics, Zhejiang University

No CIRJE-F-915, CIRJE F-Series from CIRJE, Faculty of Economics, University of Tokyo

Abstract: New economic geography focuses on the impact of falling transport costs on the spatial distribution of activities. However, it disregards the role of technological innovations, which are central to modern economic growth, as well as the role of migration costs, which are a strong impediment to moving. We show that this neglect is unwarranted. Regardless of the level of transport costs, rising labor productivity fosters the agglomeration of activities, whereas falling transport costs do not affect the location of activities. When labor is heterogeneous, the number of workers residing in the more productive region increases by decreasing order of productive e¢ ciency when labor productivity rises.

Pages: 25 pages
Date: 2014-01
New Economics Papers: this item is included in nep-eff, nep-geo and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Related works:
Working Paper: Technological Progress and Economic Geography (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:tky:fseres:2014cf915

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